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In Troubled Times Focus On The Good

By Jay Winestein|2020-04-21T20:35:36+00:00April 15th, 2020|401(k) Rollovers, Annuities, Financial Planning, Insurance, Investing, Taxes|

As we enter new and dangerous waters, there are many new questions and concerns we’ll need to re-visit.

Not only is our health at-risk daily, but so is our livelihood. Retirement, whether you’re already there or are approaching it, may face drastic, never-before-seen adjustments.

Our personal goals and values may need adjustment too.

And, perhaps, some good can come out of all this. Is eating out frequently, even at excellent restaurants, so important? Do we need to buy and spend our hard-earned money on so many games, clothes, expensive cars, and other (endless) vanity consumer goods?  Are these luxuries necessary?

Wouldn’t it be a great idea to save that money for a rainy day?

Is it a hardship to spend our new found time with people we care about, so we can find out more about each other, and what our most valid concerns are, and how we can help each other?

Well, this author doesn’t have any answer carved in stone. Instead, a general idea we’ll need to adjust our thinking (like it or not)…within ourselves as individuals, with our family, in our relationships with our communities, and even as human beings on this planet.

We also need to oversee our money.

I’ve been telling clients for so many years to be very careful of the allure of the shiny object – the flash of the equities markets. When it’s climbing like a rocket, we feel invincible. It’s human nature to do so. My father, the CPA, says to me all the time, “paper gains don’t mean too much.” And I believe he’s correct!

The issue: As an individual investor, you’re playing against “big boys,” the institutional investors, and in an instant, the winning “euphoria” you may feel can go in a 180-degree reversal… and cause a good deal of discomfort. The “math” behind the numbers, especially when you are making withdrawals from your money to live on, rarely works in your favor for an extended time.

I call it the “spend-down” problem. We discuss this at client meetings, in-depth.

When we add in taxes owed, fees paid to brokers, negative gains (losses) and inflation, not to mention the stress of leaving money behind to protect a surviving spouse or avoidance of significant medical expenses that can wipe up out half an estate, we have a lot to look out for, a lot to navigate. Every once in a while, there is a significant “correction” in the equities markets, and 3-5 years or more of gains are wiped out. As we move on in age, there’s less room, or time, to “wait it out.”

This is something to keep your eyes on and pay attention to, for sure. As we navigate ahead, our most authentic and most essential values deserve the attention, more than our account balances. It’s what money is for, to help us get what we want. Statics show more of us are opting for safer strategies, ones that are stacked with more guarantees, fewer fees, more income generation that won’t run out.

It can have a calming effect – if you follow suit. It’s an older value, one that has been time-tested way before the crazy high-tech trading became part of our lives.

Our parents and grandparents had pensions. About 20% of us – and declining – have pensions. If you know someone that has a pension, you can be very sure they are pleased about it. If you don’t have a pension, the shiny object of significant gains will be there – it’ll never die down –  yet for, most it’s starting to show itself less as a priority. The use of volatility will remain, but for smaller percentages of our money.

Why? Because the risks that come along for the ride can indeed rob us of our values. And for many, taking on risk, just for risk’s sake, simply isn’t a good fit.

The older values say, “protect yourself, protect your loved ones and stay within your means,” as you already do. You’ll sleep better at night! When we look at the coronavirus epidemic and effect, it’s had on the gains of the last three years at this writing. It has all but completely has evaporated them, reducing the gains to at best pedestrian single-digit posting over this time frame.

Time-tested financial tools like life insurance and annuities, implemented with an experienced professional can add immeasurable value to your life and your loved ones.

 

 

 

 

 

About the Author: Jay Winestein

Jay Winestein
Jay Winestein is a long time resident of Seattle. His practice has served many individuals to meet and surpass their retirement and estate planning objectives, focused on reducing Federal and State taxes in retirement, while also developing and protecting income streams to last a lifetime. Website: omnitaxadvisors.com/

Office: (206) 681-9411 | OMNI Tax Advisors

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